CEO Series: Brian Mueller

Assess the current state of private universities.
I think if you look at the top tier, the Ivy League schools, and those just below them, those people have such strong brands and such huge endowments that they are OK, and they can make it through an economic downturn without a whole lot of difficulty. … If you look at the next tier below that, I think they’re fine because their brands are good, their levels of awareness are good and the endowments allow them to keep the business of private education going. Where there is really a problem is the smaller, private universities that have great histories, that have great academic programs, that provide a great service to students, but they do not have large endowments. The economy is really hurting those kinds of institutions, which is why we’re in a good place now. We have sources of revenue other than those traditional students that come to our campus. Those sources of revenue make it possible for us to keep tuition very affordable for traditional students.

What are some of the most recent challenges that GCU has faced in the past few years, including last year’s initial public offering?
Five years ago, Grand Canyon was near bankruptcy. It was within days of going bankrupt. It was one of those private universities with a full liberal arts program that had been in existence, at that point, for 55 years, and had done a wonderful job of producing teachers and nurses, especially, but it didn’t have a large endowment. Coming in, trying to build an online program using the Grand Canyon brand for working adults was a really smart move made by the initial owners, Brent and Chris Richardson. It was a smart move, but it’s not easy to do. It’s a lot more difficult to do than people think.

They did absolutely struggle for the first three years or so, but they got the enrollment up to 15,000, it became profitable, which allowed us the opportunity to go public. That’s when they called me. They said, ‘Since you have some public company experience, would you come over and be the CEO?’

When I came over and took a look at what existed here, I thought it was a rare and unique opportunity because what you have here is Arizona’s only traditional, private university in a destination city, in a destination state, with a wonderful campus, a good brand, a long history. To build an online program on top of that is just something that doesn’t exist out there today. There is no well-branded private university that also has an extension of that mission to working adults all over the country and all over the world in an online format. There isn’t one of those, so I thought this was a wonderful opportunity, and as it turns out, I’ve been here for a year and the opportunity is even better than what I first thought.

What do you believe GCU’s role is in this current economy?
I think we have a number of very, very important roles. One, we offer working adults in the state of Arizona and all over the country a chance to do an academic program, completing a bachelor’s degree, completing a master’s degree or a doctoral degree, in an online format while they work. As we look at ourselves from that vantage point, positioned against the other players in the space, we are probably the low-cost provider … A second role that we play is that we are able to make, because of the profitability of the online students who are at the very low end from a tuition standpoint, we’re able to make the traditional college experience for traditional students in a private university very, very affordable. We just announced that we are freezing our tuition levels through the next two years, and our tuition is already way under what most private universities are. We’re lowering our room-and-board by 20 percent and we are eliminating almost all fees. We are making it possible for middle-class American families or even lower-class middle-American families to come to a private university and experience that private university setting for four years to complete their degrees and for a rate that is very close to what they would spend at a state university.

It’s a significant contribution that private universities make, because the students that they educate aren’t at all a burden to the taxpayer. There is no taxpayer subsidy that goes into supporting our students. That helps when there is a declining tax base, a declining revenue base, which is very, very important and necessary to support students who attend a state university or community college. So that’s a significant contribution to the economy. Another contribution is the fact that we are one of the fastest-growing employers in Arizona today. We’re in the West Valley, we’ve got 1,300 employees and almost 2,000 faculty members, many of them adjunct or part-time faculty members, but we are growing the employment base in Arizona. We’re one of the few companies that are in that fortunate position of being able to add hundreds of jobs on an annual basis.

We’re also going on a major building campaign here. We’re building a new dormitory that will be ready in September 2010 that will have 600 beds. We’re building a 55-thousand-square-foot events center, which will be ready next September; we’re building a new classroom facility that should be ready in September or October of next year; and we’re building an events center that will seat 5,000 people for our men’s and women’s basketball programs and for concerts. That building campaign is going to put a lot of people to work, as well.

What are skills a C-level executive needs in the private university business?
I think all of the C-level skill requirements that would be in any other industry are really important. You have to be able to think strategically about the business and set the vision for the company and make sure that it is communicated and understood and everyone knows how they are plugged into that.

Secondly, you’ve got to break down silos and you have to make sure people work together, are all on the same page and are all pulling in the same direction. There’s so much power in that and it’s not an easy thing to do. … A publicly traded company is a tricky thing, so you’ve got to run the company, but you also have to make sure you’re keeping an eye out on the target, which is to make sure that your investors get a reasonable return. So you also have to balance running the company with making sure that you are spending time with the investors, making sure that they understand your strategy, that they are comfortable with the moves you’re making, how you’re investing capital so that they feel confident that the return they are expecting they are going to get.

… With all that said, I think the people who run these kinds of companies the best are those that have a strong amount of experience in higher education. They have to be educators and people who understand education and how education works and what they think the future of education is going to be. At the end of the day, the value we are creating is around the value that is created for the students who come, learn and graduate.

Vital Stats

Named CEO of Grand Canyon University in 2008

From 1987 to 2008 was employed by Apollo Group

From 1983 to 1987 was a professor at Concordia University

Received his Master of Arts in education degree and Bachelor of Arts degree in education from Concordia University

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